Wednesday, 30 May 2012


He wrote if ABN's submission is accepted, it will be done away after the closing date which was supposed to be on April 26.

The Star reported last week that ABN is submitting its bid joining three other parties which have completed their submission much earlier.

Jaring has already received three bidders, Tan Sri Syed Mokhtar Al-Bukhary's Puncak Semangat Sdn Bhd, CMC Engineering Sdn Bhd and Optinet Technology Sdn Bhd.

Optinet Technology is a special purpose vehicle representing four local companies which includes, Melaka ICT Holdings, Jom Mobile, Ersatech Sdn Bhd, and Dignity First Sdn Bhd (in which The Mole Sdn Bhd’s adviser Datuk Ahirudin Attan is a shareholder and director). All four companies hold an equal 25 per cent equity stake in Optinet.

Puncak Semangat submitted its bid about a month ago while the two other bidders submitted theirs sometime earlier this year.

BigDog also blogged that former New Straits Times group-editor-in-chief Datuk Seri Kalimullah Hassan is believed to be a part of ABN.

The blogger places the link to ABN chief executive officer Sreedhar Subramaniam who he claims is Kalimullah's man and that they were both pioneers of the pro-opposition Malaysian Insider news portal. ABN was recently issued a digital broadcasting license by the Malaysian Communication and Multimedia Commission.

The Edge Malaysia reported that ABN is investing RM2 billion in the next 10 years to build the aerial cabling needed to carry its subscription TV service.

The report says, Jaring is one of the two companies licensed to provide wired broadband to consumer home. The other company is Telekom Malaysia Bhd which has monopolised the segment after years of building infrastructure for its  Streamyx and Unifi.

Jaring also owns eight data centers which among others can host high performance computing  and is essential in the running of an Internet service provider. ABN is said to be able to find synergistic value from Jaring's infrastructure.

ABN has not responded to calls and emails pertaining to this matter.

Jaring is a government linked company owned by the Ministry of Finance. It was initially owned by MIMOS Bhd and was Malaysia’s first internet service providers but due to lack of marketing and applied technology
Jaring was left behind. It worsened when Telekom Malaysia Bhd launched the first high speed broadband Streamyx .

To revive Jaring, a new business model, strategy and investments is needed. The upside for Jaring is that they have the infrastructure which enables new players for new high speed broadband services, IPTV and digital TV and even downstream telecommunications retailers. The announcement on the successful bidder is not known but a major consideration would be a viable business plan to turn Jaring around and the RM80 million-odd debts. Sumber
Besides Puncak Semangat, the three other parties reported to have submitted bids for the acquisition are CMC Engineering Sdn Bhd, a company controlled by Datuk Abdul Rahman Yusof, Asian Broadcasting Network Sdn Bhd, the newest digital television player to enter the media industry, and Optinet Technology Sdn Bhd.

It is understood that Puncak Semangat is close to sealing the deal and negotiations are at an advanced stage. “Most industry players already know that Puncak Semangat is close to sealing the Jaring deal. The negotiations are already at an advanced stage now,” says the source, adding that an announcement on the acquisition is expected to be made soon.

A key question and potential stumbling block in the negotiations is the price at which the Ministry of Finance Inc (MoF Inc), who holds 100% stake in Jaring, will be willing to part with the ISP.

Industry players are divided over Jaring’s valuation. Some say it could be worth as high as RM100 million, given its extensive 2.5Gbps Internet backbone infrastructure. Others disagree, putting its worth at about RM50 million or less, saying that the network infrastructure that Jaring owns is now obsolete as it was installed in 1999.

“The infrastructure that Jaring owns may be obsolete now, considering that newer technologies have emerged recently providing faster bandwidth and reliable data transfer rates. Taking this into the equation, Jaring may be worth just about RM50-RM100 million,” says the source, who is familiar with the local telecommunications industry.

This is not the first time that the government has attempted to divest its interest in Jaring to private companies. In 2004, the government attempted to force the merger of Jaring with Telekom Malaysia Bhd (TM) via a budget speech by then Prime Minister Tun Dr Mahathir Mohamad. However, TM later pulled the plug on the merger and the plan did not materialise.

Then in 2006, Time dotCom Bhd attempted to buy Jaring, with the blessings of MoF Inc, but the attempt also fizzled out. At one point, even Singapore’s Singapore Telecommunications Ltd was reportedly keen on buying up Jaring. Other well-known local telco players such as Green Packet Bhd and REDtone International Bhd have not shown interest in the current bids for Jaring.

Whoever acquires Jaring now will also take into account that it is laden with losses to the tune of about RM80 million.

Jaring was created in 1992 when it was still a division with Mimos Bhd, the government’s research and development (R&D) unit on high technology.

In 1997, it was the first ISP in South-East Asia to install the T3 (45Mbps) line, giving high-speed access to the Internet. In 1999, Jaring upped the ante by introducing its SuperJaring, a 2.5Gbps network backbone, making it the fastest and longest (841km) IPover-fibre backbone service available in the world at that time.

However, mounting losses made the government review Jaring and in 2005 it was spun off as a separate entity from Mimos, while still being the latter’s subsidiary. The following year, MoF Inc officially took direct control of Jaring from Mimos. It is estimated that Jaring then had a subscriber base of about 500,000.Sumber KLIK

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